legal proceedings update

I refer to the following Legal Proceedings Update dated 6 December 2011:

http://www.allianceresources.com.au/IRM/Company/ShowPage.aspx?CPID=1362&EID=71975327

We have previously discussed in the thread titled 'settlement' whether it is likely AGS has settled the misleading and deceptive conduct proceedings or whether it is likely that matter will proceed to hearing.

Some of you may have read the Legal Proceedings Update and came to the conclusion that the misleading and deceptive conduct case was destined for trial because of the following statement, "...it will, inevitably, be some time before all preliminary matters are resolved and a trial date is set by the Court."

It seems to me that the wording of the Legal Proceedings Update may have been recycled (for lack of a better word) from previous update notices or written sometime earlier. The reason I say this is because at the time of the update notice on 6 December 2011, a trial date had already been set by the Court, at least in the SA Supreme Court matter, and had in fact passed (5 December 2011). Consequently, it is my opinion that the comments that it will be "some time" before a trial date is set by the Court in the misleading and deceptive conduct matter may not have been intended as at 6 December 2011.

In support of my view above, I note that the Legal Proceedings Update makes reference to ACE seeking "restitution of the 75% interest in the exploration licence over the Four Mile" from Quasar in the misleading and deceptive conduct matter. However, the settlement clearly includes the registration of a Native Title Mining Agreement (NTMA). If the NTMA relates to both ACE and Quasar, this would effectively disentitle ACE to "restitution of the 75% interest in the exploration licence over Four Mile" in the misleading and deceptive conduct matter.

In other words, by agreeing to register a NTMA with Quasar before a trial of the misleading and deceptive conduct matter, ACE is arguably conceding Quasar's right or entitlement to an interest in the exploration licence (although it could be a lesser interest than 75%). In any event, what this indicates to me is that it is unlikely that there will be a full blown hearing of the misleading and deceptive conduct matter in pursuit of the entire interest in Four Mile. As previously indicated, this leads me to the conclusion that the termination of the misleading and deceptive conduct matter may be a condition precedent to the settlement that was executed on 4 December 2011.

One final thought, the circumstances of Quasar filing the 2nd NTMA following the institution of proceedings in the SA Supreme Court by ACE, could be seen as an admission or evidence that Quasar knew that the 1st NTMA was defective or otherwise in breach of the joint venture agreement and relevant contracts. Why else would Quasar feel the need to file a 2nd NTMA that didn't include the Beverly facility (this is referenced in one of the cases)...